Former General Motors vice chairman Bob Lutz announced Wednesday on CNBC that he believes Tesla is “grossly overvalued” right now.
The outspoken automotive executive, who made the comment on the network’s “Squawk Alley” program, echoed a sentiment expressed by Tesla-founder Elon Musk earlier this month.
Although Musk didn’t go quite as far as Lutz — the Tesla CEO simply expressed some doubts about how high his company’s stock has climbed in recent months.
Lutz told CNBC, “Elon Musk is right. It’s grossly overvalued right now,” Lutz said. “When you look at it, their total production to date is still less than one day’s production of General Motors or Ford, so it’s filled with a lot of hype.”
Since Musk made his comments on Sept. 5, Tesla stock has fallen from $US286 to around $US250 per share.
In the segment, Lutz also cautioned that until Tesla builds a successful smaller and cheaper model with 200-300 miles of range — something it’s planning to do with the upcoming Model 3 — it will remain a “fringe” brand.
Lutz — whose legendary career include executive positions at Ford, BMW, and Chrysler — maintains that the current lithium-ion battery technology being used by electric carmakers provides only limited range. If you want to travel farther, you have to go for a $US100,000 Tesla, he argued — and that’s a “limited market” in his estimation.
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